Members Hit GAO for Lack of Raises

Posted May 22, 2007 at 6:35pm

Members chided Comptroller General David Walker at a joint oversight committee hearing on Tuesday for “breaking his commitment to Congress” when he denied cost-of-living pay increases to hundreds of employees at the Government Accountability Office.

Members also expressed concern that personnel reforms at the agency were undertaken without sufficient feedback from GAO employees, hurt black workers and potentially broke the law.

“The situation that has unfolded at GAO is of particular concern to me, as well as many of my colleagues,” said Rep. Danny Davis (D-Ill.), chairman of the House Oversight and Government Reform subcommittee on the federal workforce, postal service and the District of Columbia.

He later added: “It is of great concern that GAO never consulted with Congress, either before or after it denied GAO employees who met expectations their cost-of-living increase.”

Davis’ subcommittee held the hearing in conjunction with the Senate Homeland Security and Governmental Affairs subcommittee on oversight of government management, the federal workforce and the District of Columbia. The hearing was designed to examine the results of the Human Capital Reform Act of 2004 — the legislation that gave the comptroller general the power to implement a more market-based pay system at the GAO.

That system divided the agency’s 1,500 analysts into new pay “bands,” with pay levels and salary increases measured in part by what band the employees are placed in.

Questions centered around Congressional testimony Walker gave in 2003, when he told Members he would give cost-of-living raises to all employees who earn a “meets expectations” performance rating. When the reforms were implemented, 308 employees with such a ranking did not receive the pay adjustment.

D.C. Del. Eleanor Holmes Norton (D) questioned the move, saying that according to the legislation that allowed Walker to implement the system, Congress specifically sought to make sure all eligible employees received raises.

“What happened, it seems to me, was in violation of the law,” Norton said.

Walker told the panel that he did not intend to mislead Congress and believes the agency has complied with all laws and regulations.

The decision to deny raises came after the agency received the results of a pay study conducted by the firm Watson Wyatt Worldwide, which found that those employees who did not get the pay hikes already were being paid above market levels.

“In retrospect, we should have advised the Congress and others sooner that we did not view my prior statements as applying to employees who were paid above market levels,” Walker said. “I am sorry that we did not do that. However, the fact remains that I did not believe then, nor do I believe now, that it would be appropriate or equitable to provide across-the-board pay increases to employees who are paid above market levels.”

Walker further testified that while 10 percent of GAO analysts were denied cost-of-living increases in 2006, that number dropped to 5 percent this year and should reach zero by the time he leaves the agency in 2013.

No employee suffered a pay cut, Walker added, an assertion that was questioned by the general counsel of the agency’s Personnel Appeals Board.

Anne Wagner — who represented 12 employees who successfully petitioned the agency for pay increases and back pay — said that by denying employees a cost-of-living raise, the agency hurt its ability to keep up with inflation and essentially decreased their pay.

Wagner added that the “fact that there were some events that happened later” does not change the fact that in the statute, Congress intended that all GAO employees who meet the requirements receive raises.

Members said it is important to give employees those cost-of-living raises, especially since there is so much competition in the private sector.

“They are valued employees,” said Rep. Stephen Lynch (D-Mass.) “We don’t want them to slip back.”

For his part, Walker said he is considering “a good faith gesture” that would allow those who have not gotten cost-of-living raises to earn either a performance-based raise or a cost-of-living adjustment — whichever is greater.

In total, 11 people testified before the committee, with some questioning the Watson Wyatt study on which the new personnel system was based.

Charles Fay, a professor at Rutgers University who studies human resource management, said there were a number of problems with the study, including the way the data itself was gathered, who was involved with the study and the documentation of the process.

“GAO is noted for the quality of its analyses,” Fay said. “It is unfortunate that the same care was not taken with the analysis of its own pay system.”

Still, the agency did get some support for the personnel system. Max Stier, president and CEO of the Partnership for Public Service, said its own analysis of the GAO found it to be the No. 2 place to work among federal government agencies, based on a variety of factors.

Sen. George Voinovich (R-Ohio), ranking member on the Homeland Security and Governmental Affairs subcommittee on oversight of government management, the federal workforce and the District of Columbia, said he believes Walker is acting in good faith and that Congress should give the agency more time to implement the system before making any drastic changes.

“Cultural transformation takes time,” he said.

While cost-of-living raises were the focus of the hearing, Members expressed other concerns — particularly the effect the new personnel system has had on black employees.

There are big differences in staffing and compensation levels between black workers and others at the agency, said Ronald Stroman, the managing director of the GAO’s Office of Opportunity and Inclusiveness.

In part, this has happened because black employees do not receive the type of feedback needed to help them advance, Stroman said.

Walker told the panel he was aware that there is concern about staffing levels for minorities and said a study has been commissioned to analyze the issue.